Te pŪrongo 2012
11 Property, plant and equipment (continued)
Valuation
Land
Land is valued at fair value using market-based evidence based on its highest and best use with reference to
comparable land values.
The most recent valuation of land was performed by registered independent valuers William Hickey and Dave
Wigmore of Jones Lang LaSalle and the valuation is effective as at 31 December 2012.
Buildings
Specialised buildings (for example, campuses) are valued at fair value using depreciated replacement cost because
no reliable market data is available for buildings designed for education delivery purposes.
Depreciated replacement cost is determined using a number of significant assumptions including:
• The replacement asset is based on the reproduction cost of the specific assets with adjustments where
appropriate for obsolescence due to over-design or surplus capacity.
• The replacement cost is derived from recent construction contracts of similar assets and Property Institute of
New Zealand cost information.
• The remaining life of assets is estimated.
• Straight-line depreciation has been applied in determining the depreciated replacement cost value of the asset.
Non-specialised buildings (for example, residential buildings) are revalued at fair value using market-based evidence.
Market rates and capitalisation rates were applied to reflect market value.
The most recent valuation of buildings was performed by registered independent valuers William Hickey and Dave
Wigmore of Jones Lang LaSalle and the valuation is effective as at 31 December 2012.
Work in progress
The total value of property, plant and equipment in the course of construction is $1,195,898 (2011 - $1,593,661).
Notes to the financial statements (continued)
98
